Journalist
Published:
- Coinbase delisted USDT when the MiCA guidelines came into effect.
- USDT’s market cap fell by $4 billion as insiders called the delisting “Tether FUD.”
In mid-December, crypto exchange Coinbase removed Tether’s USDT from its platform, citing “non-compliance” with EU crypto regulation MiCA (Markets in Crypto Assets Regulatory), l one of the most robust cryptographic standards that came into force on December 30.
As one of the largest dollar-indexed investors stable coins In terms of market capitalization, Tether’s USDT dominated until recently when the market began to readjust to MiCA guidelines.
According to a recent Kaiko reportCircle’s USDC, the largest MiCA-compliant stablecoin, could gain more market share after USDT’s delisting.
Silence from the regulator on the status of USDT
Despite Coinbase’s decision, the regulator and advisor for MiCA compliance, ESMA (EU Securities and Markets Authority), has not officially communicated the compliance status of USDT as of this writing.
Binance and other exchanges have reportedly restricted some USDT services for EU users. Part of the exchange’s recent statement read,
“Binance announced its approach to non-MiCA stablecoins in June 2024, and there will be no changes until further notice. USDT remains supported for custody; deposits and withdrawals are not affected. We encourage users to use USDC and EURI as they are MiCA-compliant stablecoins.
So, does ESMA’s silence mean USDT could be non-compliant?
According to Juan Ignacio Ibanez, technical member of the European crypto compliance advocacy group MiCA Crypto Alliance, the silence of regulators does not suggest that USDT is compliant. In an interview with Cointelegraph, Ibanez said:
“No regulator has explicitly stated that USDT is non-compliant, but that doesn’t mean it is.”
However, some industry insiders pointed out that only Coinbase has delisted USDT.
Samson Mow, CEO of nation-state consulting firm BTC on January 3, called the delisting of a “Tether FUD”. He said,
“Apart from Coinbase (which is invested in Circle), no other exchange is considering delisting USDt in the short term for European users. Local European regulators have a grace period of more than 12 months.
Source: Coingecko
The current reshuffle of the EU has train The market capitalization of USDT increased from $141 billion to $137 billion. Other insiders have warned that delisting USDT could affect liquidity in EU markets and reinforce US dominance.
